Targeting a paradigm shift in stroke rehabilitationJanne Huhtala | CEO | Nexstim

Lupaavat Pörssiyhtiöt 2015

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Important informationThis document and the information contained herein are being presented by Nexstim Oyj (“Nexstim” or the “Company”). In connection with any presentation or review of this document, you agree to be bound by the following limitations and notifications. This document and the information contained herein are being provided to you solely for your information. The distribution of this document in some jurisdictions may be restricted by law and persons into whose possession this document comes are required to inform themselves about and observe any such restrictions. Accordingly, this document may not be distributed in any jurisdiction except under circumstances that will result in compliance with applicable laws and regulations.This document is not a prospectus, and the information contained herein does not and is not intended to constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of any securities referred to herein in any jurisdiction. This document and the information contained herein are not an offer of securities in the United States and are not for distribution in the United States. Any securities to which these materials relate have not been and will not be, registered under the U.S. Securities Act 1933, as amended (the "Securities Act") or with any securities regulatory authority of any state of the United States. Any securities to which these materials relate may not be offered, sold, pledged or otherwise transferred directly or indirectly within the United States or to, or for the account or benefit of, U.S. Persons (as defined in Regulation S under the Securities Act). Should any recipient of this document consider an investment in the Company, such recipient must rely on their own examination of the legal, taxation, financial and other consequences of any possible holding or transaction involving the Company’s shares, including the merits and risks involved. Recipients should not treat the contents of the document as advice relating to legal, taxation or other matters and are advised to consult their own professional advisors concerning the acquisition, holding or disposal of shares in the Company. This presentation does not purport to be all-inclusive or to contain any or all the information that prospective investors may desire in analysing and deciding whether or not to hold or transact in the Company’s shares. Nexstim's NBS System is cleared by the FDA for assessment of the motor and speech cortices for pre-procedural planning. The NBT System is not cleared for commercial distribution in the United States.

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Introduction

Nexstim at a glance

● Finnish medtech

● Established in 2000

● 34 employees

● Offices in US and Germany

● Backed by leading European life-science VCs

● Listed in Nasdaq Helsinki & Stockholm

Nexstim’s Navigated Brain Therapy® (NBT) solution for stroke rehabilitation

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Nexstim – Targeting a paradigm shift in stroke rehabilitation

Targeting a blockbuster market

Potentiaal game-changer technology

2.1 million strokes each year in US and Europe

712,000 patients is Nexstim’s target # of patients

$1.8 billion market potential for NexstimFew effective alternatives…

…still $8.5bn currently spent on stroke rehab in the US

Promising efficacy demonstrated in completed Phase II clinical trial

Technology already validated – Pioneered the technology to map motor and speech centers, with 120 devices installed worldwide and FDA clearance –same technology now applied in stroke rehabilitation

Huge unmet need and commercial opportunity

Targeting a blockbuster market…(market for post-acute stroke treatment)

…with a potential game-changer technology

Nexstim’s Navigated Brain Therapy® (NBT) solution for stroke rehabilitation

Introduction

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Introduction

Technology platform applied in stroke and brain surgery

(1) rTMS = repetitive transcranial magnetic stimulation

Novel technology Two products Main uses Status

Navigated Brain

Therapy®(NBT)

Stroke rehabilitationPrecise localisation of the

correct motor center in the brain followed by

stimulation to improve motor functions

Pre-surgical mappingMapping of the motor and

speech centers prior to brain surgery to avoid damage to

these vital areas

–CE marked

–Positive Phase II data

–Pivotal Phase III trial in the US ongoing at 12 sites

–FDA cleared, CE marked

–120 instruments installed

–Outcome data published showing better outcomes for cancer patients

Navigational accuracy is Nexstim’s key differentiator– already proven for pre-surgical mapping (NBS) and now ready for paradigm shift in stroke therapy (NBT)

Navigation technology to deliver accurate magnetic

pulses to stimulate the brain

Navigated Brain

Stimulation®(NBS)

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Stroke–NBT System

NBT for stroke rehabilitation – How it works

Problem post stroke:Overactive inhibition from the non-damaged side interferes when the patient tries to move paralyzed limb

Source: Khedr et al, Eur J Neurol, 2009; Kakuda et al, PM&R 2011

Nexstim’ssolution:Repeated inhibitory stimulation to non-damaged side restores balance, removing barriers for improvement

Non-lesioned

Lesioned

Imbalance

Paralysed limb

Non-lesioned

Lesioned

Balance restored

Inhibitory stimulation restores balance

Improved limb movement

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Stroke –NBT System

Efficacy demonstrated in Phase II trial

Note: “Robotics”, “Intentive conventional rehab” and “Non-navigated rTMS” data come from different studies. While not directly comparable, included in the above chart for illustrative purposes. | (1) Data for “Treatment group” and “Sham group” from Nexstim Phase II clinical trial (Harvey et al, 2013) – per protocol figures. | (2) Data for “Robotics” and “Intensive conventional rehab” from published multi-center trial (Lo et al, NEJM 2010) | (3) Data for “Non-navigated rTMS” from published multi-center trial (Kakuda et al, J Neuroeng Rehab 2012), 6 month follow-up not done. Responder rate = % of group that had improvements above the 5 point minimal clinically important difference threshold.

0

5

10

15

20

Baseline 1 monthpost treatment

6 monthspost treatment

Nexstim NBT group⁽¹⁾ Sham (placebo) group⁽¹⁾

Robotics⁽²⁾ Intensive conventional rehab⁽²⁾

Non-navigated rTMS⁽³⁾ Min clinically important difference, MCID

Change in upper extremity Fugl-Meyer score from baseline

Difference: treatment and sham groups

Absolute average improvement of13.8 Fugl-Meyer scores

= difference of "holding an object" and "buttoning a shirt"

Pre Post

Trial outcome:

The Phase II clinical trial in brief:

– Single centre at Rehabilitation Institute of Chicago (#1rehabilitation hospital in US for 24 consecutive years)

– 29 patients of which 19 (10) in treatment (sham) group

– End-point = 6 months post treatment

P<0.05

84% responder rate(above "MCID" for NBT® group)

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Stroke –NBT System

Nexstim’s unique technology provides distinct benefits

Integration of TMS and navigation

● TMS-navigation integration: Nexstim combines non-invasive transcranial magnetic stimulation (TMS) with unique proprietary electric field modeling-based navigational capabilities

● Navigation is the key differentiator

● Improved accuracy: Accurate localisation of the target muscle representation area on the cortex

● Dosing precision: Optimisedstimulating electric field location, direction and dose

● Repeatability: Accurate and repeatable stimulation

● Non-invasive procedure

Enhanced limb moveSeveral distinct benefits

● Substantially improved hand movement after treatment demonstrated in Nexstim’s Phase II trial

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Patents

IP position

60 granted patents

67 pending patents

Right to software: Nexstim owns rights to its NBT and NBS Systems’ software developed by it.

Creating hurdles for competitors: by e.g. seeking patent protection on different parts of the products and making it more difficult for potential competitors to create competing products

Core algorithms kept as trade secrets: Not patenting the core algorithms to avoid publicity and loss of trade secrets

(1) Future/protective = for future use or protective patent | (2) Joint ownership with Elekta Oy

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Stroke –NBT System

Phase III trials - Laying the groundwork for commercialisation

Study in brief Conducted at 12 top US rehab sites

Simplified timeline

– Study initiated

Promising results from Phase II trial

Commer-cialisation

Sep ‘14 Q3 ‘15 Q1 ‘16 Q3 ‘16

– Centres selected– Enrolment on

schedule

Initiation On track

Outcome data

FDA clearance

KOL support

● Document effects/efficacy of NBT on upper-limb motor rehab

● Obtain FDA De Novo 510(k) clearance for right to market and sell NBT in US

● Build support from key opinion leaders (KOLs) to support commersialisation

Milestone 1 Milestone 2 Milestone 3

– Interim analysis based on 81 patients

– Interim analysis based on 138

patients

– Final analysis based on 198 patients

● Establish clinical efficacy of NBT in upper-limb motor rehabilitation

● Up to 198 patients

● 12 top US rehab sites – RIC is central site (#1 US rehabilitation hospital for 24 years)

● Dr. Richard L. Harvey lead investigator – one of the top experts in the field

● FDA reviewed protocol

Study goals

Rehabilitation Institute of Chicago (central site)

TIRR Memorial Hermann Hospital (Houston)

Spaulding Rehabilitation Hospital (Boston)

Ohio State University (Columbus, OH)

Rancho Los Amigos National Rehabilitation Center

Burke Rehabilitation Hospital (White Plains, NY)

Duke University Medical Center (Durham, NC)

Columbia Cornell New York Presbyterian Hospital

Shepherd Center (Atlanta)

University of Cincinnati

Indiana University Indianapolis

Mayo Clinic (Phoenix, AZ)

Spring ‘14

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Highlights in Stroke Rehabilitation (NBT)

Stroke–NBT System

– 2.1m strokes each year in the US and Europe– Stroke is the leading cause of long-term disability in Western worldHuge unmet need

Few effective alternatives

Promising, validated technology

Potential blockbuster market

Clear execution strategy

– While current standard treatment of physical/occupational therapy is not very effective, $8.5bn is still currently spent on stroke rehab in the US

– $1.8bn is estimated value of Nexstim’s target market (US and Europe)

– Statistically significant efficacy in stroke rehabilitation vs. sham treatment (standard therapy)

– Navigation already validated by NBS

– Phase III trial on track: Establish efficacy in Phase III to obtain FDA clearance and KOL support

– Commercialisation strategy: Convince users of benefits, providers of economic benefits and obtain reimbursement coverage from payers

Targeting a paradigm shift in stroke rehabilitation